What is the Home Buyers' Plan?

What is the Home Buyers' Plan (HBP) ?

The Home Buyers' Plan is a government program that allows first-time Home buyers to take up to $25,000 tax-free dollars out of their RRSP account to buy, build or put towards a Home for yourself or a relative with a disability. Of course, you must pay back this money over a 15-year period.

How do I qualify for a HBP?

To qualify for the HBP, you must:

  • Prove that you and your spouse/common-law partner are first-time Home buyers.

You are considered a first-time Home buyer if you did not live in a Home registered under you or your spouse/common-law partners name in the four year period.

The four-year period: Begins on January 1st of the fourth year before the year you withdraw funds. The period ends 31 days before the date you withdraw the funds.

A simpler explanation: 

You withdrew your funds on April 30, 2019.

The four-year period would begin on January 1, 2015 and end on March 31, 2019.

  • Sign an agreement which states the money is strictly for the Home purchase or the build.
  • Move into the Home no later than one year after signing the lease or after the build is complete.

How does the repayment work?

There is no repayment required in the year you withdraw funds OR in the year after.

HBP repayment begins in the second year after the year of withdrawal.

A simpler explanation: 

If you withdrew from your RRSP in accordance with the HBP in 2019.

Your first-repayment would be in 2021. 

What happens if I miss a payment? 

If you miss a HBP payment, that specific payment is now considered taxable income. Frequent missed payments will drive Home buyers further into debt.


Contact a HomeHow advisor for a free First-Time Home Buyer consultation to understand more about the Home Buyers' Plan.

We encourage any questions you have about the HBP and how it can benefit you and your families future Home.

HomeHow Mortgage.